♪ ...saving on your medicare prescriptions is easy. ♪ so you're free to focus on the things that really matter. call humana at 1-800-808-4003. or go twalmart.com forails. captioned by closed captioning services, inc >> chris: i'm chris wallace. a personal scandal forces c.i.a. director david petraeus is>> a personal scandal forced petraeus to resign. we will discuss the startling end to a brilliant career and look ahead to the congressional investigation to the terror attack in benghazi with the chairman of the senate intelligence committee diane fine stein. it's a fox news sunday exclusive. then the new year will bring higher taxes and huge spending cuts unless a divided washington cuts a deal. we will talk with four congressional leaders who will play big roles in trying to find a compromise.

republican senator and congressman tom price and democratic senator ken conrad. plus president obama looks ahead to a second term while republicans look to regroup. we will ask our sunday panel about what both sides need to do moving forward all right now on "fox news sunday." >> hello again from fox news in washington on veteran's day when we honor the military for their service to our nation. sadly we begin with a dramatic fall from bragrace of one of th most respected military men of this generation retired four star general and cia director general petraeus stepped down after admitting to an extra marital affair. to discuss that and the deadly terror attack in libya is the chairman of the senate committee diane finestein senator. welcome to fox news sunday.

in a statement you said you understand petraeus's decision to resign but you wish president obama had not accepted that. after more revelations this weekend do you still feel that way? >> i talked to day petraeus twice on friday. he said to me, i have done an egregiously dishonorable thing and i need now to do the honorable thing. when i thought about it, for me it's a heartbreak. this is a truly bright man, a credible person, a great leader and could have really been a super transitional figure for the cia. this is very, very hard and i do think he did the right thing. >> now you have accepted it. >> when you realize additional complications which i did not at the time i spoke to him, i think he did the right thing. i think the president really had

no choice but to accept the resignation. >> let me ask you about those additional complications. it turns out the fbi found out about this because paula brock well the mistress was sending threatening e-mails to another woman whom she regarded as a threat to her relationship with petraeus. what do you know about that relationship between the other woman and petraeus? >> well, there is an fbi investigation. that is continuing. i read both the post and the times this morning and it is pretty well laid out, i think. it i hate to discuss it except to say there are a nom of things that one has to consider. the first of which was there any kind of national security breech. to date there was not. and the fbi had briefed me now. i actually wish we had been

briefed a little earlier. one of the things i have tried to do is get both sides together. the chairman and i share material and worked together. that is a very important concept with neither of us knowing all of this comes as a big shock, and we are very muchable to keep things in a classified setting at least if you know you can begin to think and then to plan and of course we have not had that opportunity. we begin our hearings on thursday. there are many different aspects of it. obviously general petraeus, excuse me, director petraeus is going to be part of the hearing process. >> you said -- i have to ask you directly, do you believe that this other woman was also in a relationship, an affair with

general petraeus? >> no. i have not been told there was an affair. what i was told was there was somebody else he knew and was close to and that mrs. broadwell sent these threatening e-mails to her and she was frightened and she went to the fbi. i can't believe it. but that's what it is. >> let's talk about the fbi. by law they are supposed to inform your committee about any development of significance to this committee. that barely passed this fresh hold. is it true you have received no advance word of this and are you going to investigate the fbi's decision not to tell you an investigation had been going on for at least weeks? >> the answer is yes and yes. we seed no advance notice. it was like a lightening bolt. the way i found out i came back

to washington thursday night. the staff director told me to call from press about this. i called david petraeus. as a matter of fact, i had had an appointment with him at 3:00 that afternoon. that was canceled and so then when these questions came up i obviously took action myself to try to find out and then informed my vice-chairman and i talked to the director twice. this is very hard stuff. >> are you going to investigate why the fbi didn't notify you before? >> yes, absolutely. this is something that could have had an effect on national security. i think we should have been told. there is a way to do it and that is just to inform the chair and the vice-chairman of both

committees to -- this has happened before not with precise same things but none of the four of us have ever breached that confidentiality. >> let me ask you, you raise the hearings, and we are going to get into that in a moment but petraeus was supposed to testify in a closed hearing your committee will hold on thursday about the attack on benghazi. now because petraeus has stepped down his deputy now acting directory placement mike morrell is going to testify in his place. one are you going to insist on hearing from petraeus at some point and secondly, do you think there is any link between his resignation and the events in benghazi? >> the events in benghazi and his resignation absolutely not. if you really think this thing out everybody will come to the same conclusion. with respect to calling petraeus before the committee that will

be a committee decision. this will begin with the director and mike morrell who is acting director to the cia. matt olson of the counter-terrorism center. >> ask about the hearing in a second. do you think you will hear from general petraeus? >> we will ask. that is up to the committee we have the first hearing which is the way we want to set it up and the committee will make the decision. >> let's turn to the hearing it's an inquiry what is the biggest question the biggest concern. >> well, my biggest concern is there are literally hundreds of threat warnings in the material that has been accumulated. the there were five attacks during the year. one prior attack on the consulate itself. the question i have is, you

know, why wasn't something done about it? there are many options one is to recall the ambassador, sit down with him have his personal assessment and security see what you can do and do it. the second to immediately beef things up in a way. changes were made but the changes were not major. what is clear to me and i went to the memorial service in san francisco for chris stevens the libyan ambassador to the united states spoke and twice during his remarks he said i am so sorry that we couldn not protec your consulate which is a total admission that the libyan government was incapable of protecting our facilities. this raises a major question for the future. we have 285 embassies and counsel l

consulates over the world. threats pour in what do we do? >> do you think u.s. officials in washington had enough information before hand, enough of these warnings to beef up security before the attack ever happened? >> well, that's the purpose of our inquiry. the decision will be made by the dmiet. i have not had an opportunity yet to go through what are thousands of pages, and i want to do that, i want other members to do it. we don't want to jump to any conclusions. tfld appear to me, and it was just me, that the five prior incidents in the year which aren't intelligence they aren't threats they are actual attacks on the british ambassador on our consulate once before on a number of other things in the united states mission. now, that to me is sufficient intelligence to make a decision. so we want to make what the ex

ten rating circumstances are that security wasn't beefed up like us if it wasn't beefed up by the libyans or if we closed down the consulate. >> do you think there was enough time between the 7 hours of the first attack on the cons laulat and the second attack the following morning that there was enough time to deploy u.s. forces to protect the americans there? >> my understanding there was not. i can't be positive right now before we have these hearings and we hear the testimony on that question. it is an important question and it must be answered. >> one more question. there were also the changing stories after the attack, changing stories from administration officials about what actually happened. let's take a look. >> do you believe this was a terrorist attack? >> it is too early to know exactly how this came about.

>> what happened initially it was a spontaneous reaction to what had just transpired in cairo and a consequence of the video. >> yes, they were killed in the course of a terrorist attack on our embassy. >> the natural protest that owe rose because of the out rooifrj the video were used as an excuse by extremists to see if they could also directly harm u.s. interests. >> i am asking you personally not the committee as a whole, how do you explain these shifting stories and the president continuing to talk about the video after the head of the counter-terrorism center said it was a terror attack, and do you think it had anything to do with politics in the middle of the presidential campaign? >> i don't think it had anything to do with politics. i think it had something to do with our assessment. my view is very simple and very direct. the minute you know mortars are

used or rpg's are used it's either a terrorist attack or a military attack. those are the only two things it could be. a terrorist isn't necessarily all one thing. a terrorist uses the attacks as a vehicle, and we all know that now, therefore it is pretty clear the minute mortars show up the minute rpg's show up you have a terrorist attack. >> why was the president a week later talking about the video especially when it turns out, and they knew in real time it was never a protest to begin with? >> these things can be assessed into oblivion, too. i go by prior incidents. give me a good assessment of whether there is a high likelihood so the assessment can be confident. that assessment could be made

early on with confidence. having said that again i have not seen these hundreds of threat warnings. i want to look at them and go through them. this now comes down to our purpose. we have been very proud that over the time from 9-11 the stove pipes have been down, the intelligence have been better analyzed, it has been red teams it has been passed on. we have a national security branch and we have a counter-terrorism center and all of the above. now the question comes how does that all really work. this is a live incident to show something went wrong in the assessment. i want to see exactly what it is. i don't want to be premature. i don't think you want me to be premature either, chris. >> no, i don't. i want you to tell us what you know and that's it. senator fine stein thank you for coming in. when you know more please come

back. we will follow your investigation into libya every step of the way. >> up next as we draw ever closer to the fiscal cliff higher taxes and deep spending cuts we will ask four key members of congress if they can reach a deal before the new year. your runny nose. [ sighs ] thank you! [ male announcer ] you're welcome. that's the cold truth!

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>> chris: we are now just 51 day aceway from fiscal cliff when $644 billion in tax hikes and spending cuts will kick in next year unless the president and congress make a 644 billion tax cuts will kick in unless congress makes a deal. we will be at the center of any compromise to discuss what is possible and what isn't. senators bob corker and conrad and tom price and chris van holland. welcome back to fox news sunday.

>> let me start with you. how real is the threat? can washington figure out a way in 51 days to cut trillions for the deficit or can you get an extension and kick the can down the road? >> i certainly hope we don't kick the can down the road. we all know what the issues are. we have had two dry runs already. nothing has changed. i hope at least we will go substantially down the road. people are complaining the fiscal cliff with fiscal reform. i know kent and i and chris and others, tom had been working a long time on fiscal reform. what i think we don't need to lose our eye on is the fact that that's what needs to be solved. i thi i am hopeful when i listen to the speaker when listen to the president, the key to solving this is medicare reform. i think the other two need to fall in place.

democrats are about going over the cliff knowing all of the spending cuts kick in and blame it on the republicans. >> i don't know where you are hearing that. certainly don't hear that from me. i spent five years trying to put together a package in a bipartisan way to get us back in a sound fiscal course. i think it's clear we have a problem we have to make sure we are doing everything we can to shrink growth and we have a longer term problem that is unsustainable fiscal course for the nation. that requires revenue reform which is bob corker talking about fundamental reform. we need it in entitlement and social security in the revenue side of the equation. i should hasten to say social security piece i don't think should be part of a deficit package but we need to address social security because it is headed to insolvency more.

>> let's talk about taxes which has gotten most of the tanks. house speaker john boehner offered a compromise in week in which he says i am willing to put more revenue on to the table but with through closing deductions end gd loopholes not through raising rates. can you accept a compromise as part of the whole deal that doesn't raise the push tax rate on the wealthy? >> how much revenue are we going to generate as part of a balanced package. in their framework they assume the amount of revenue as if we started tax reform from a 39 percent rate. that is part of their built in assumption. i am all for doing tax reform. the issue is from what starting point. i think the bowl starting point which assumies that revenue fro 39 percent is the right way to go to get the mix they got in hitting their deficit reduction

target. if what speaker boehner was saying he was truly willing to get office ready we begin to work with one another. if what he is simply saying is what republicans used to say which is we are going to lower rate on the wealthy and that will somehow generate -- >> he was talking about closing loopholes and deductions. >> the jury is out still on the -- let me be clear. the tone was good. i think the jury is out on what he said. others may have to clarify. but he said something in a very hurtf artful way in which many people heard differently. >> are you willing to accept more revenue if it doesn't mean the bush tax cut has to be rescinded for the wealthy and rises from 35 to 39 percent.

if they make the matt work. >> the issue is the math. the starting point should be going back to clinton era rates. then proceeding with tax reform as the speaker may have been talking about if he was generally talking about eliminating revenues to eliminating loopholes. >> let's right now extend the bush tax cut rates for the 98 percent of the people making less than 250,000 dollars. he says i will sign it right away. take a look. >> let's not wait. even if we are negotiating a broader deficit reduction package let's extend the middle class tax cuts right now. i have the pen. ready to sign the bill right away. i am ready to do it. >> democrats say that you -- and i talk about republicans won't accept that because you want to hold the tax cuts of the middle class hostage until you get what you want on tax cuts for the

wealthy. >> we want our real solution. house republicans want real sol luises. to that that means you have to have economic growth. a tax cut never created new jobs. get economic broet and vitality get the jobs being created. that means more revenue. >> would you accept this piecemeal tax the extension of the bush tax cuts of 98 percent of people under 250. >> it doesn't make sense to raise taxes on job kree tors. the equation is revenue and spending. we can increase revenue without increasing the tax rates. we can lower the rates, broaden the base, close the loopholes as you have discussed, put in place program policies in energy and healthcare and regulatory poll seep and then address the spending. the spending that has to be addressed is medicare, medicaid. >> boehner seemed to be saying i

am going to close some of the loop hole he is and use some of the revenue from closing loopholes to cut the deficit. >> that's a way to reach the agreement. that's what many of us are saying. >> it's taking some of the money the tax expenditures through loopholes and using it as a deficit saving. >> you limit the deductions and credit and lower the limits and the rates. that's the solution. you have a draft plan you have been serving to the members of the senate is there a deal here? >> the ying and yang there has to be revenues. i haven't met a wealthy republican or democrat in tennessee that is not willing to contribute more as long as they know we solved the problem. the ying of revenue i think we understand that's a pro growth

way of putting that in place. what you have tied to that is true entitlement reform. people know we solve a problem. >> is there a basis of a deal here? no it's not raising the bush tax rate but it is tax reform we closed the loopholes. will that work? >> it could. i think the reality is bowl simpson which i was a part of lowered rates but raised more revenue. >> closing off preferences exclusions deductions and it equalized capital gains and dividends with other tax rates. if you really want to go to where many think the tax rate is unfair you have close to an effective rate of a top rate of 35 percent people who are much much wealthier seeing an effective rate of 13 or 14

percent. that is really unfair. how does that happen? it largely happens because there is a 20 percent differential between capital gains and income. 35 percent for ordinary income, 55 for gains. >> i know you have been chomping at the bit to get the spending in entitlement reform which has to be part of any deal. congressman van holland a year ago august when boehner and obama were involved in the debt talks the grand bargain the president put on the table raising the eligibility age for medicare and slowing the cost of living adjustment for securioci security. would you accept that? >> i have to look at the over all appeal. we have already made significant reforms to medicare there is a complication on this issue which is the supreme court decision that some

don't cover people on medicaid could leave lots of individuals in that age group vulnerable. so that is a major complicating factor as we move forward. i am willing to look at -- i think democrats and the president is willing to look at everything. >> major entitlement reform. >> everyone has a different meaning of the entitlement reform. of course during the last campaign democrats which was serious reform with respect to medicare. we have savings by changing incentives in the program as opposed to savings with medicare by transferring those costs on to beneficiaries. that is not the way to go. >> congressman price speaker boehner was asked whether the republican drive to kill obama care is dead. here's what he said.

>> it is clear the president was re-elected obama care is the law of the land. >> question, do most house republicans do you agree with speaker boehner that repealed obama care with this election, with this reelection? >> we are not opposed to the president's healthcare law because of the election. we are opposed because it's bad policy p and bad for patients across this land. we absolutely must get a handle on the spending and in order to do that it has to be medicare reform medicaid reform and social security reform. under current law they are destined for quail your. we need fundamental reforms to strengthen and secure these programs for this generation and future generations. that's what real solution looks likes. >> you still have the awe majority in the house. you won't have obama care for the next four years. >> the american people don't want unified government in

washington they want divided government. bhiens we have to get together and solve these remarkable challenges. they have to be solved with real solutions not with things that don't solve the problem. that's what we have been doing for years and years. >> let me go to the two senators to end this. i come away from this with a lot of the same old arguments coming up. are we going to go over the cliff or not? >> no. >> is that because the ticket is down the road? >> i think it would be the reason we don't go over the cliff is taking it down the road. we have been through two dry runs there's nothing new. let's make a huge down payment on this problem and this is going to take years of work. look, i am optimistic. >> you think there's a basis for a deal? >> i think there's a basis for

the deal. i think finally democrats are willing to accept, but i think they know republicans really are willing to put revenues on the table if we can do it in a pro growth way. you saw the "washington post" editorial this morning laid out 750 billion an easy way of getting there. there is a way of getting there on the revenue side. the question is can we come to terms on the entitlement side by the way when you deal with entitlements you don't do anything that deals with the economy in the short term. $27 trillion problem which exists is medicare. that is where the focus needs to be. we can get to the appropriate revenue mix if we do that. >> senator you are in the -- you are a lame duck in the lame-duck session as your final act before you leave office is there a basis for a deal here? >> i absolutely believe there

is. you can't settle every detail in these next few weeks. what you can do is agree on a framework agreement that sets out for the committees of jurisdiction how much they need to save, how much money needs to be raised, what we can also do is have a significant down payment so the markets understand what we can also do is have a back step so the committees of jurisdiction did not perform there would be a real consequence. >> the fiscal cliff that's what happens here. >> the difference is the fiscal cliff was designed not to happen. that is the sec quest tore across the board cuts 1.2 trillion was designed to be so own russ nobody would accept it. we need to have a backup to something that would be good policy if they didn't act. >> we will be watching ever strip of the next 51 days. good luck. >> the four more years in the

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>> i am looking forward to reaching out and working with leaders of both parties to meet the challenges. we can only solve together. reducing our deficit, reforming our tax code, fixing our immigration system, freeing ourselves from foreign oil. we have more work to do. >> that was president owe bambina in his victory speech promising to work with congress to get big things done in his second term. it is time for our sunday group bill kristol of the weekly standard. former senator evan bayh talk show host laura ingram and kirsten powers from the daily beast web site.

what are the realistic changes they can work with republicans in the second term to solve the nation's problems. >> you will have major xri indications in the second term. i think republicans will have to give in much more than they think. they won the election. they won 50 percent of the vote twice. vose velroosevelt eisenhower an obama. democrats think the president is in good shape republicans in the house be able to get some concessions and compromises. but i think there will be a big budget deal next year. it will be a paul ryan budget deal. elections have consequences. >> you heard him say no the country voted for divided they gave house republicans a mandate. as a moderate democrat yourself what do you think is the key to how obama finds a way to work with the gop and not just

senator two more years of gridlock. >> i have been as pessimistic about gridlock in washington. like bill i am some what modestly on the miss thieshg. the president has more flexibility to stand up to his base on entitlement reform. the republicans remember when mitch mcconnell said make sure he is a one-term president. the president will be thinking about his legacy wanting to get things done. they lost voters by 56 percent. all that suggests to me is the president says something teaching the fiscal cliff i am willing to have 3-1 spending reductions as well as tax increases and pro growth tax reform package you can get something done there. >> president's second term notoriously difficult and the fact is the president won real election he didn't give as much of an agenda for his second term

during the campaign. what do you expect from him that he has to worry ever again about reelection? >> go back to 2010 where they had the great mid term election. republicans think compromise is the answer for their political future. i would say think about what president obama did that ended up helping him win a huge reelection. he decided not to compromise he decided to double down on liberal i am. he marketed it in a new way he found inflexion points with women voters. he did it masterfully with jim macina and the whole crew i would think republicans and conservatives need to figure out what they stand for. i think the president will go full steam ahead with the agenda. i think we heard talk of compromise before senator we heard it during healthcare in the end it was my way or the highway. he got what you wanted with very

little support. i think you will hear that again. >> he did expend the bush tax cuts for a year. >> he had to do that. democrats were urging him to do that. i think he ran through immigration reform or amnesty i think goes further toward carbon pack toward environmental regulation that is are waiting. there is a huge regulatory framework they have been holding up on it the second term are going to be regulation heaven. >> you just laid out the two biggest things that will happen if obama has his way immigration reform but the reason it will happen is because there are republicans chastened and are going to work with him on it. that would be one major accomplishment that he would get

done. >> do you agree with lawyer rurs not going to go to the center? >> we are never going to agree on where the president is. i think he is fairly moderate. >> on what issue? what issue is he moderate? >> he did compromise on the tax cuts for example which is a major issue for democrats. >> on one thing. >> even in his healths care legislation the public option was taken off the table. >> we have the shocking resignation of david petraeus. i want to get your thoughts on that. the whole national security framework secretary of state clinton and pineda saying they want to step down. what does that say. >> start with petraeus. >> terrible end to a terrible week. i don't know anything more than

any one else does. national security challenges are quicker than what they realize. we can put that on the back burner he's secretary state, secretary of defense. major decisions have to be made about syria where 30,000 people have been killed and we are losing influence. what is the president going to do. the administration's policy is more responsible in my view to try to get it but they have support on the hil if republicans and democrats think we are defeated in afghanistan sending troops over there does he want to get out of the war does he want to have a stable outcome in which case he needs to rally the country. he will have a busy foreign policy agenda. >> senator you are going to get the last word. >> the same with david petraeus.

patriotic american. he served his country well. it is most unfortunate. we have a deep edge you will see the president making a smooth transition there. the big issue over the next 12 months is we are coming to a moment of truth in iran's nuclear program. we are facing a fork in the road no attractive alternatives but profound consequences considering what path we take. he is going to compromise on legislation because he has to he will be more progressive on the regular tore reap front because he can. >> on the petraeus thing it is tragic that's a given. we have real questions here. we have the head of the intelligence and the entire country sending personal e-mails after he was named cia. ron kessler's report is he had broken up the relationship.

he was sending thousands of e-mails to his personal account. eric holder was the one who knew about this to have not brought this to the president of the united states i think questions have to be asked was it not brought to the president's attention because of political concerns? national security and politicses which come first. our security is on the line. our cia director was apparently distracted enough by whatever this was that he was sending scores and scores of e-mails from a personal account. this is insanity not just tragedy. >> that is unconfirmed. >> i think we have a congress with vetted the investigation and they have up on capitol hill. >> tragic question outrage more for the american people. all of these other stories are being told with other women. >> washington times has this. >> if females were being sent why aren't we talking about

that. >> national security. >> who cares about that. national security concerns for the country. >> we can take a break here. you can tell it's going to be a very calm relaxed second term. also here at fox news sunday when we come back after a tough election night for republicans, how does the gop come back?

it's clear that as a political party we have some work to do. i think the principles of our party are sound. how we talk about who we are as a party is clearly,

conversations are underway and. >> chris: that was house speaker john boehner acknowledging republicans have to retool after a disappointing election. we're back now with the panel. laura, how much trouble is the g.o.p. in? >> well, it depends how they react to this. the reaction to the election is let's dig in to our core principles and try to remake them, i think g.o.p. will lose even more seats in 2014. if it becomes a bidding war with the republicans and this group or that group, latinos or women, we will give you more stuff or do the amnesty plus, just to keep in line with panel plus, chris. amnesty plus won't work. republicans have to take a lesson from them. it hate to bring up reagan again but when goldwater got shellacked in '64, bill buckley and brent mosell senior got together and said we'll figure out how to sell the idea of the economic conservatism, con seventive framework to new voters. they went to south and transformed mississippi and

alabama and places where people never vote republican before. it took time and a lot of intraspec. intraspection. it wasn't them deciding our frame wok of ideas were wrong. it depends how they react. >> chris: kirsten, look at the exit polls that point out the challenge that republicans face. put it on the screen. republicans lost women by 11 points. hispanics by 44 points. young people by 23 points. what does that tell you? >> i think, well, first, losing women by 11 points isn't that new, because they lost them by 13 points last time. it's more interesting to look at the swing states where there is a much bigger swing. i think that if you want to look at something recently that happened that is similar to this, i'd say 2004. that is what this reminds me of this. reminds me of the day after democrats, you know, just absolutely falling apart, my gosh, we have a new conservative majority, how are we going to change to attract

them. there is a little bit of an overreaction on right except for immigration issue. i think because of demographics of the country that the republicans are going to have to figure out a way to attract hispanic vote. they have to do a better job with women. they could win an election still with that gender gap. it's just like i said if you look at states where obama administration bombarded women with messages, you saw much bigger gaps. >> chris: senator bayh, you know, it's interesting because i was thinking of 2004 as welch pendulum swings back and forth. after 2004 when bush had issues, and he still won, democrats were disspirited. obviously four years later they came roaring back. what do republicans need to do? >> two elections i'm thinking of, chris, number one, four years ago 2008 when some parts of the democratic party said this is a vote for a new progressive era and left-leaning government. it turns out that wasn't quite

the case. our party needs to be modest in the mandate we take away from it. we need togone from progressive center out. then 1988 from the republicans' perspective. democrat just lost two elections in a row to ronald reagan. what did we do? we nominated michael dukakis who is a fine man but a liberal from massachusetts. it took three beatings for to us realize you have to make common cause of moderates. that is the internal struggle the republican have to go through. true to principle on fiscal issues but if they embrace the far right social agenda it drives off the young people and alienate single women and suburban women and you see it in the numbers. >> senator, in your state of indiana -- >> can i say one last thing? if i could just get -- if i could say one last thing. please continue to nominate people for public office talking about women being rap rapeed. >> won by only five points such a bad year. republicans should not kid

themselves. republican lost 25 of 33 senate seats. republicans gained back the seats easy to gain back when no other new state at the presidential level. obama had a tough economy, glow gone from the first term, and all of that. republicans lost the national household by half a million votes. they held the house to redistricting and the democratic voters are more concentrated in some districts. it was a bad year. youth vote is worrisome. 60 to 40. i believe republicans have the right policies for future. i believe that the democrats are defending snore what do the rave dogs -- >> chris: so what do the republicans do? >> don't be more moderate or conservative. the answer is be fresh thinking, taken as moderate. some issues are more conservative. a huge middle class problem. the particular nominee the republicans had unfortunate in that respect four years after a huge wall street crisis. nominate someone from wall street. i think honest debate, fresh thinking, leadership in the republican party and the

leadership of the conservative movement has to pull back and let people float new ideas. have a serious debate. don't scream and yell when one person says it won't kill the country if we raise taxes a little bit on the millionaires. it won't. i don't understand why republicans don't take obama's offer to raise taxes for everyone below $250,000. make it $1 million. really? the republican party is going to fall on its sword to defend millionaires? half of whom voted democratic and half of whom live in hollywood? >> chris: let me ask you about this. this is the second reflection a row where it's fair to say the republicans squandered a really good chance to take over the senate. by all mathieu call rights -- mathematical rights they had ten seats to defend. democrats had 23. they nominated people strong enough to win in primaries but too out of the mainstream to win in general election. does the republican party have a tea party problem? >> no. it has as much republican establishment problem as tea party problem. establishment nominees were nominated in florida and

virginia and north dakota and montana. they lost. sitting congressmen who had the same stale establish. republican message. republicans have some tea party problem and some establishment problem. and basically they should get away from either me nighcally defending the establishment or the tea party. let the young people volunteer themselves. >> chris: 30 seconds. >> we have heard the tea party thing. we heard it in 2006. too far right it was called then. we have bad candidates. murdoch. terrible candidates. why did scott brown lose in massachusetts? why did we lose the north dakota senate seat? because of the tea party? if it weren't for the tea party folks and energy they brought to the fore, republicans would be in a disaster now. it doesn't mean they don't have to nominate great people. bill is right. but tea party, how many times do they get blamed for moderate losing seats? c'mon. >> chris: thank you, panel. see you next week. check out panel plus where the group will pick up with the discussion on the website. foxnewssunday.com. we will post the video before noon eastern time.

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>>. hris: be >> before we go a follow up to our interview last week with obama senior campaign strategist david ox elrod. we asked him about a bet he made to shave off his mustache if the president lost. >> how secure is your mustache today? >> the next time we see each other i guarantee you the mustache will be right where it is today and it has been for 40 years by the way. you know how serious the bet was. >> after he said it attracted so much attention he had another idea this week. he and his wife have a daughter named lauren who has epilepsy. they are key figures in citizen's united researching epilepsy for a cure. now david promised to shave his mustache if folks will donate 1 million in total by the end of this month. it's a good cause you can find more information at cure epilep epilepsy.org. let's face it, it would be fun